Collaborative effort

Two health-care systems with a long history of competition have joined forces to propose building a 200-bed hospital in southern Virginia Beach.

Sentara Princess Anne Hospital would be run collaboratively by Sentara Healthcare and Bon Secours Hampton Roads under a plan now under review by the Virginia Department of Health.

The plan is the result of a state approval process in which neither company initially got what it wanted. Both systems provide outpatient services on medical campuses close to the proposed hospital site in the city’s Princess Anne section. Sentara wanted to build a 158-bed hospital on its campus and received a certificate of public need in March for a 120-bed facility. State officials denied Bon Secours’ application to build a 90-bed hospital on its campus.

The not-for-profit companies submitted a new plan that would set aside Sentara’s proposal if they were permitted to collaborate on a single project. They offered to create a hospital whose size would almost equal the combined capacity of the two original hospital proposals.

Executives for both systems say the joint proposal, estimated at $222.6 million, would provide the patient services of two hospitals at a saving of more than $100 million. “The patient ends up benefiting,” says Michael Kerner, CEO of Bon Secours Hampton Roads.

“Our objective …is to offer the most health care we can to as many people with the fewest resources,” says Mike Gentry, Sentara’s vice president for Southside Hampton Roads.
Cooperation between competing health-care systems is rare in Virginia, but it is becoming more common elsewhere. In Charleston, S.C., for instance, Bon Secours is one of three hospitals in a health-care partnership, Kerner says.
The Princess Anne proposal so far has received a favorable recommendation from a regional health systems agency whose assessment must be considered in the application process. But the state health department’s staff has recommended approval of a smaller, 130-bed hospital. Among other reasons, the staff report says a 200-bed hospital in southern Virginia Beach will exceed current needs.
Also, hospitals and officials in nearby Chesapeake have voiced opposition. They are worried that a new hospital would steal patients from the city.

A hearing on the proposal was scheduled this spring, but a final ruling by the state is not expected for several months.

Both systems say they hoped to persuade the state to approve their 200-bed proposal. Bon Secours’ Kerner said he hoped the two systems would work in partnership even if a smaller hospital is approved.